Former employees sue foreclosure attorney David Stern

Ex-workers claim they weren't given proper notce before being fired

The law offices of David J. Stern are housed in Plantation. (Ginny Dixon, Sun Sentinel )

December 1, 2010|By Harriet Johnson Brackey, Sun Sentinel

Former employees of the law firm of David J. Stern and a related company have filed a federal lawsuit asking for back wages and benefits because they claim that hundreds of employees were fired without 60 days' advance notice, as required under federal law.

The layoffs over the past two months at Stern's foreclosure law firm in Plantation were among the largest firings in Broward County during the current economic downturn. More than 700 people were let go, according to federal regulatory filings.

Stern's firm, one of four major Florida law firms specializing in foreclosure, retrenched following a Florida Attorney General's Office investigation into allegations that it produced faulty paperwork for foreclosure cases. The revelations of foreclosure-documentation problems involving several lenders and law firms, including Stern's, lead to halts in thousands of foreclosure cases nationwide as major lenders and loan servicers stopped to review their processes. Three other Florida law firms are also being investigated by the state's attorney general.

At Stern's firm, large clients, including government-owned Federal National Mortgage Association (Fannie Mae), pulled its business. Then the layoffs began, in October and November.

As the employees were being let go, DJSP Enterprises filed a WARN notice Nov. 9 saying that 435 people were being terminated between Nov. 4 and Nov. 12.

"They belatedly filed a document that purports to be compliant with the WARN notice [requirement]," said attorney Gary Farmer, who filed the lawsuit along with Gary Farmer, Dawn Rapoport and Chandra Parker Doucette. Farmer said the notice is "worthless" because employees were not given 60 days' notice ahead of time.

In one of the layoffs, hundreds of employees were notified by e-mail to clear out of the office within an hour.

Four former Stern employees, whose lawsuit is seeking class-action status, want to recover back pay, benefits, vacation time and access to continuation of their health insurance coverage through the federal law known as COBRA.

Farmer cited the experience of Nikki Mack, who worked for Stern's firm for 14 years until she was fired in October. Farmer said Mack, who was going through treatment for cancer, wasn't given the proper paperwork to continue her health insurance through COBRA.

"I worked all through the treatments, I feel hurt that this is happening," Mack told television station CBS 4. "He knew the situation I was going through with my illness."

A lawyer representing Stern could not be reached for comment on the lawsuit, despite several attempts by phone.